Hiring a funeral director is the biggest cost for most people, but you can save money by shopping around.
Photograph: Alamy Stock Photo

Few people shop around for a funeral. In the highly charged emotional state following the death of a loved one, saving money seldom tops the list of priorities. But does this mean that partners and families are left with excessive bills? Just how much should we expect to pay for a funeral in 2016?

A basic funeral is currently around £3,700 – and that’s just for the funeral director costs. Add in the crematorium and cemetery fees, plus the price of a small reception or wake, and the total cost can easily exceed £5,000.

Guardian Money research has found that councils have been discreetly raising the cost of burial by far more than the rate of inflation or wage increases. What’s more, our price checking of large funeral directors such as Co-operative Funeralcare has found they charge as much as £1,500 more than independent local firms.

In the past year, the price of cremation has increased on average by 4.8%, while burial costs are up by 4.9%. More than 50 crematoriums across the UK raised their prices by more than 5%, and a handful by more than 20%. These figures have to be laboriously gathered from local councils and private companies as they are under no obligation to report price rises.

The major cost for most people is hiring a funeral director. These are the firms that arrange the funeral, store the body of the deceased, deal with paperwork and arrange the coffin and hearse.

One of the simplest things you can do to save money is to shop around. The two biggest chains are Co-operative Funeralcare and Dignity, which together make up 30% of all funeral parlours in Britain.

In terms of price, the differences are marked. We obtained prices from 30 funeral directors in Glasgow and south London in July, made up of five independent funeral homes, five Co-operative Funeralcare outlets and five Dignity branches in each city. Dignity was easily the most expensive (see table below), costing around £1,000-£1,500 more than independent firms. Prices in the table are for a standard funeral, including the cost of a coffin, hearse and professional service fees, but do not include disbursements such as the cemetery or crematorium costs, which will vary according to individual councils.

In response to the rising prices, a growing number of groups and businesses are fighting for fairer pricing of funerals. The Funeral Poverty Pledge, set up by anti-poverty charity Quaker Social Action, for example, encourages funeral directors to be more transparent over their pricing models and lists the businesses that have signed up to the pledge.

Funeral comparison sites are another recent innovation supporting industry transparency. One such site, Funeralbooker.com, enables users to compare prices for some (though not all) local funeral directors. Sites such as these are a good starting point for arranging a funeral, but you should meet with the funeral director in person before making your final decision.

Similarly, you should not choose a funeral director on the basis of price alone. You need to be able to trust the company and work together to deliver the funeral that’s right for you and your family. If one funeral home isn’t quite right, don’t be afraid to walk away and find another.

In the past year, the price of cremation has increased on average by 4.8%, while burial costs are up by 4.9%

Sometimes hospitals will enlist the services of a funeral director to pick up the body, but you do not have to use that company. Again, if nothing has been signed, you are free to choose another provider.

Any reputable funeral director will have an itemised price list available when you visit, but it’s still worthwhile asking how the end cost is worked out. Some price lists are far from straightforward.

The greatest cost incurred is the professional service fee, which covers the funeral director liaising with third parties, picking up the body within working hours, refrigeration, preparation of body, cleaning, washing, dressing, driving from the funeral home via the home of the deceased to the crematorium or cemetery, and the hiring of pallbearers. The fee might or might not include the cost of a hearse. All this typically costs around £1,000.

In the past, funeral businesses were family-owned operations that would serve whole communities, and in some small towns this setup still exists. However, larger chains have been gradually buying out family businesses, often when members of the family retire.

These large chains tend to keep the name of the family that originally ran the funeral home. Every branch of Dignity is run under a family name and 30% of Co-operative funeral homes trade under a family’s name. When these businesses buy up independent funeral homes, they purchase the use of the family name and, consequently, their reputation. Many customers visit funeral homes with family names in the belief they are supporting a local independent business or because they would rather place their trust in a family-owned organisation.

Unfortunately, many of us are reluctant to discuss and plan for the practicalities of death, a subject steeped in taboo. We put off conversations until we find the “right time”, we ignore the inevitable, and outsource the practical arrangements to hospitals and funeral homes. Only 2% of people know what their loved ones’ last wishes are and no one is placing funeral arrangements at the top of their to-do list.

This attitude has sparked several attempts to open up the conversation about death. My Gift of Grace is a card game for “living and dying well”, designed to prompt those difficult conversations, covering end-of-life care and last wishes. Another interesting development are so-called death cafes where people can meet and discuss their own mortality over a coffee. Even so, little has been done to tackle the practicalities of arranging a funeral.

Thinking outside the box

When it comes to alternative send-offs, funeral directors have only a limited range of brochures and catalogues to flick through, writes Patrick Collinson. If you’re looking for a funeral a little out of the ordinary, the best place to start is online.

There are the wacky ideas – like having your ashes pressed into a vinyl record, made into a firework or launched into space. For the eco-minded, the best option is a woodland burial in a biodegradable coffin made from materials such as bamboo, rattan or willow.

Then there are the cost-effective ideas. Some go as far as to organise entire DIY funerals, roping in favours from family and friends without ever consulting a funeral director. Families can decorate the coffin and the location of the service with drawings and flowers, build their own coffin, use their own car for the hearse – the works.

Funeral directors aren’t essential to funerals, but they certainly remove much of the inevitable stress of doing it yourself. Some funeral directors will work with you to create a funeral that’s significantly cheaper and more personal while others will be against the idea on principle.